This study researches the association between schools’ ethnic diversity and the three dimensions of teacher burnout: emotional exhaustion, depersonalization and reduced sense of personal accomplishment. Two possible explanations, teachers’ ethnic prejudice and teachability perceptions of the students, are examined. The first hypothesis states that teachers who work in schools with a high ethnically diverse student population will perceive these students as less teachable, leading towards less positive relationships and therefore are more likely to develop a burnout. The second hypothesis is that teachers are less prejudiced towards ethnic minorities when teaching in high ethnically diverse schools, develop more positive relationships with their students, and as a consequence are less likely to develop a burnout. Through a multilevel analysis, we investigated data (2014- 2015), which was gathered from 635 secondary school teachers in 45 urban schools. The findings indicate that only teachers’ emotional exhaustion is dependent on the school context. The students’ ethnic diversity contributes to emotional exhaustion via the lower level of teachability that teachers attribute to the students in these schools. This study indicates the importance of positive teachability perceptions of students for teachers to remain engaged within their schools and to teach in a culturally responsive way.